Storini

Although Oz seems to have fewer social problems than the UK (at present), I am less optimistic about its long-term economic prospects. This article here => http://crikey.com.au/articles/2005/06/20-1622-9669.html gives a pretty good analysis of the issues. The newspapers and politicians in Oz always talk up Oz success, but the reality is that Oz business is globally speaking a lightweight. The one medium-term growth area is mineral exports from WA to China, which will be massive: however, this is a low added-value primary producer role open to substitution. Could Oz end up like NZ, a end-of-the line nowhere branch economy?

soapy©

only now that im here

Bix

It's not just to China.

It is a real shame but Aus is exporting it's wealth in the form of all the crude metals and minerals it is extracting.

The real wealth in these natural resources lies in the sale of the processed materials.

They are basically digging up the country and shovelling it into ships and selling it at low cost.

Phoenixuk2oz

And who's doing the ship shovelling I ask myself

mr mover

NO ...........mm

Bix

Where you bin ?

It's been soooooo quiet

I'm exporting processed goods I'll have you know. Value added stuff

Phoenixuk2oz

Busy ship shovellin

Hows it goin Bixy? Missed anythin

Bix

Going well ta.

Erm.......lots of people got visas (even that shifty WMoore character)

Erm.......Soapy and Scossie still talking pish.

Erm.......You'll have to do a search.

mr mover

Be specific BIX ,iron ore, lpg, may be All copper from the Olympic Dam mine is smelted and processed on site, the copper pacs [3tonnes] are sent all over the world at a premium...................... mm

Bix

The point I am getting to is there is not enough manufacturing in Aus to take advantage of the rich minerals here.

Okay an example.
Queensland exported 13.6 million tons of bauxite but only 3.1 million tons of the processed alumina / aluminium. It's roughly 2 tons of crude to make 1 ton of processed so in effect 2 thirds are being exported in the crude state. The money is in the processed product not the crude.

Merlot

No cause Britain beat ya too it!

M

Megalania

Bauxite = gibbsite (Al(OH)3) + diaspore (AlO(OH)) + boehmite (AlO(OH)) + 30 to 50% impurities.

So aluminium metal content of bauxite ~= 0.5 * (27 / (27 + 3 * (16 + 1))) = 17.3%.

The aluminium metal content of alumina (Al2O3) = (2 * 27) / (2 * 27 + 3 * 16) = 52.9%.

To produce a tonne of aluminium metal requires about 5 tonnes of bauxite or 1.9 tonnes of alumina.

To produce 1 tonne of alumina requires ~3 tonnes of bauxite.

90% of bauxite mined in Aus is refined to alumina (Al2O3) in Aus, increasing the value by 10 times.

Energy efficiency best practice in the Australian aluminium industry

Storini

The issue is not whether the aluminium is going out as bauxite or alumina, its why it's not going out as aeroplane wings, rockets, forgings, prefabricated structures, etc etc: i.e. truly high added-value items. When I hear the term "Made in Australia" what do I think of? Toy stuffed koalas and Akubra hats! Australia has good(ish) universities and technical education, so why hasn't it done as well as others like Korea for example? Here's another article about large companies dependency on government http://crikey.com.au/articles/2005/06/29-1539-590.html - cozy duopoly seems to suit all sides (except the punter who gets shafted).

Megalania

Good luck competing with Asian manufacturers. Korea has no mineral wealth to speak of so has no choice in its exports but manufactured goods.

Britain still has considerable financial wealth, some oil but little mineral wealth and has "lost" its manufacturing to other parts of the world and now exports primarily financial services.

ABCDiamond

Look more closely at the labels, you may find it says "Made in China" on many of them, especially the Koalas